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Peter Siedem is heading to J.P. Morgan Chase's distressed desk from Lehman Brothers, according to market watchers. Siedem was the head distressed trader at Lazard Freres before switching to Lehman about a year ago. He could not be reached for comment. A Lehman spokesman declined to comment. Officials at Chase would not comment.

The bank debt for Teligent is said to be slipping in a market with weak appetite for telecom paper. Last week paper was offered in the low 20s, and a dealer said the market is as low as 15. "There's a lack of financing for telecom buildouts," said a market watcher. "[Teligent] is afflicted with the same change in sentiment that a lot of these telecom names are afflicted with. They had issued a lot of bonds and bank debt on build out plan, and a customer base isn't materializing to service the debt. The indicated market is 15-25, but it might be a tighter inside market." Calls to the company were not returned.

Dearborn, Mich.-based Rouge Industries closed a $250 million revolving credit facility with lead arranger Congress Financial Corporation, opting out of its historic relationship with BANK ONE over pricing issues. Gary Latendresse, cfo, said the company chose a new lead arranger in response to Congress presenting the most favorable bid to the company. "We looked at all factors--fees, interest rates, covenants, and reporting and overall Congress was the strongest in these categories," he said. In describing a tough loan market for the U.S. steel industry, Latendresse said, "If there are any modifications on a loan, given the opportunity they're upping interest, covenants and security requirements because the steel industry is not in good financial shape," he said.

The market is still shaken and stirred on Washington Group's announcement earlier this month that it may have to file for Chapter 11 bankruptcy protection. Early last week the bank debt traded at 60-61, then hit a low of 55. "There's still a lot of uncertainty of how things will shake out with Raytheon," a dealer said, citing the legal snare between the two companies after Washington Group bought out the construction and engineering arm of Raytheon. "Everyone's pointing fingers, and it's very difficult at this point to figure out what's going on."

Moody's Investors Service assigned a Ba3 rating to Williams Communications Group's incremental $950 million bank facility because of the risk associated with transitioning from network construction stage to broadband service provider. "The source of revenue is different from when a company is up and running and lit versus a company at its transition point," said John Page, senior analyst. "A typical model for a company is to construct the network and meanwhile pre-sell wholesale components to reduce construction costs. As you finish, you have capacity you can wholesale." The company reports that 88% of its Year 2000 network revenues were comprised of recurring service revenues, including increasing revenues derived from its preferred carrier alliance with SBC Communications. Williams, based in Tulsa, Okla., is a national provider of communications services and network systems.

Lehman Brothers and Salomon Smith Barney are pitching an original issue discount on their deal for Williams Communications, a pioneering twist market players say amounts to a "disguised up-front fee" to entice disheartened investors into the $300 million institutional piece of the struggling deal. Bankers said the six-year term loan "B" is being offered at a discount to par at 96 3/4 as a way for the firms to answer present buyside concerns regarding secondary telecom trading levels and the negative effect telecom paper is having on the net asset values of their funds. But at press time last week agents had only one commitment in. Scott Schubert, cfo of Williams Communications, declined to comment. Officials at Lehman Brothers declined to comment and Salomon Smith Barney officials did not return calls.

The Australian taxation office is proposing new rules that will better define the accounting and therefore tax treatment of convertible and hybrid securities. The proposals are designed to increase transparency, and define whether such instruments are equity, in which case their distributions will be franked (and therefore taxed at a lower rate for Australian investors), or whether they are debt instruments, in which case the interest payments will be tax deductible for the issuers. As it stands, Australia's tax regime has discouraged the issuance of convertible bonds in favour of either hybrid securities such as the Woolworths income securities or convertible preference share issues. The Woolworth notes, for example, are perpetual income securities and are tax deductible as interest paying notes for the issuer.

Bendigo Bank, the regional Australian bank, priced its third and largest mortgage securitisation last Friday, with a A$400m deal that lead manager Deutsche Bank claimed was the tightest priced MBS in Australia to date. The Banksia Trust Series 2001-1 secured a weighted average margin over time (Wamot) of 33.3bp over the three month bank bills swap rate (BBSW), for a blended average life of 4.8 years.

Suncorp Metway added to the amount of issuance into the Australian domestic market this week, when it launched a A$400m transferable certificate of desposit (TCD) issue. Deutsche Bank and UBS Warburg joint lead managed the transaction for the Brisbane-based financial services house. The deal consisted of a A$200m fixed rate tranche and a A$250m floating rate note (FRN) tranche, increased from original expectations of A$200m.

Tenaga Nasional launched its new 10 year bond issue to strong market interest this week, against a background of volatile equity conditions and the uncertainty following the Federal Reserve interest rate cut. However, some observers were surprised at the eventual spread of the deal, which was priced at the outside range of diverse market speculation.

Australian transport and logistics group Toll Holdings launched a A$115m subordinated convertible note issue on March 16 through lead manager Macquarie Bank. Toll will use the funds to pay down debt associated with the A$144m acquisition of Finemores and the A$12m acquisition of ARN Logistics. Macquarie placed A$28m worth of notes with institutional investors. The balance of A$87m is being offered to existing shareholders through a rights issue.

Details of the Transfield Services IPO emerged on Monday when the company filed with the Australian Stock Exchange to raise A$151m through the offer of 75.6m shares. The institutional bookbuild is priced at A$1.85-A$2.10 per share and the retail offer is fixed at A$2.00 at which price the company would have a market capitalisation of A$275m. The retail offer opens on Monday, March 26, and the institutional offer opens on April 30. The institutional price will be set on May 2. Between 60% and 70% of the shares are slated for institutions, 5%-10% for staff and the balance for the public.